The Incline Village real estate market continues to hum along with 7 new listings and 9 properties going into escrow during the past week. Except for the super high-end, all other price ranges saw activity with the properties going under contract ranging from $435,000 for a 600 ft.² condo in Pinebrook up to $3.6 million.
The latter property is a spacious nearly 4500 ft.², 4 bedroom, 5 bath home on 1 of our favorite streets in town Caddie Court. This delightful cul-de-sac is right next to the Championship Golf Course. It has only a handful of homes that boast large lots and private settings. This particular property has great architectural appeal and with its well-designed interior spaces is wonderful for entertaining.
While our blog last week talked about the continued uptrend in local prices there is some recent news that gives us cause for concern that we may be approaching a market top. Local property managers have indicated that rents for one-year leases on residential properties are starting to decline. Also, it appears that a significant number of landlords are considering selling when the leases terminate this year. Just how much inventory enters the market is uncertain at this juncture. But this has been an indicator in previous real estate cycles that prices are reaching an apex.
Adding some additional weight to this argument is the dramatic rise in mortgage interest rates. While this is not a huge factor historically impacting Incline Village real estate prices it often foreshadows an overall slowdown in purchases of vacation homes.
In the event that the Federal Reserve raises interest rates faster than anticipated this could potentially push the country into recession sometime in the next 12 to 18 months. Americans typically start to dispose of vacation homes, boats and other expensive discretionary items when a recession hits. We have not yet seen any evidence of this happening just yet but it’s something worth keeping an eye on.
In many parts of the country real estate prices have started to plateau as first-time buyers get squeezed out of the market due to higher interest rates. Some areas in Arizona and Georgia are being propped up as large corporations and investment funds continue to purchase residential properties and turn them into long-term rentals. But like politics, all real estate is local…
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